Was there any doubt?
Who’s to blame for creating most problems for U.S. taxpayers?
That’s right, it’s Congress.
The National Taxpayer Advocate, in a report released Wednesday, names Congress as the biggest culprit when it comes to creating problems bedeviling taxpayers. That’s not a surprising conclusion. Taxpayers have known it for years.
The report concludes that congressional votes — coming at the end of 2007 — to modify the tax code created havoc for the Internal Revenue Service and top the list of problems confronting taxpayers. Because of those end-of-year votes, more than 3 million taxpayers will have to wait until February to receive their tax refunds because Congress was late changing the alternative minimum tax, according to the Internal Revenue Service. The change should have, and could have, been made in time to allow those taxpayers to receive their refunds before February.
In late December, Congress placed a one-year freeze on the growth of the alternative minimum tax, which shields many middle- and upper-middle income taxpayers from first exposure to the tax. The late fix means the IRS will not be able to begin processing five AMT-related forms until February, delaying potential refunds for those taxpayers until February.
The change was made after the time the Internal Revenue Service usually prints the forms for the coming tax season.
But Congress isn’t alone in receiving blame from the National Taxpayer Advocate, according to a report by The Associated Press. The National Taxpayer Advocate accuses the Internal Revenue Service of not doing enough to help bankrupt people and entities, including people losing their homes, avoid paying taxes on canceled debts and not providing fee waivers to low-income taxpayers.
Working independently within the Internal Revenue Service, the National Taxpayer Advocate is required by Congress to report each year on at least 20 of the most serious problems faced by taxpayers. Just last year, the National Taxpayer Advocate put the spotlight on the alternative minimum tax. Originally, that tax was imposed to make sure that a small number of the superrich pay taxes. Because it was never adjusted for inflation, the tax now affects millions of upper-middle income level people, according to a report by The Associated Press.
The National Taxpayer Advocate reported other problems, too, according to an AP report. They include, but are not limited to, the following:
It’s beneficial that the National Taxpayer Advocate identifies such problems.
It would be even more beneficial, especially to taxpayers, if those problems are fixed.
Anyone in Congress or with the IRS listening?
If not, that’s another problem the National Taxpayer Advocate can add to next year’s list of the 20 worst problems that taxpayers face.